When you think of the term ‘offshore banking’, you’re probably associating it with the ever-looming stigma of tax evasion. But in reality, nothing could be further from the truth. Taking advantage of offshore banking and its benefits is perfectly legal in most countries worldwide. But what exactly is an offshore account? And how does it work?
Offshore current and savings accounts are simply bank accounts held in a different country to the one in which you reside. And despite the mystique surrounding them, it is a relatively simple process to open one.
Like any other standard bank account, offshore banks require your personal information, including your name, date of birth, address, citizenship, and occupation. You will also need to prove that the money you want to deposit has been acquired legally through the form of payslips, business documents, and investments or real estate information.
Many offshore banks will require a minimum deposit to open an account. This can range from £1 to £10,000, depending on your chosen bank. Once opened, the most convenient and confidential way to deposit or withdraw your money is through a domestic account -although this will be subject to wire transfer charges.
Offshore banks also offer debit cards to access your funds from any ATM across the world. However, due to the higher withdrawal fee, it is recommended that you withdraw large amounts at any one time to save on transaction costs.
An offshore bank account can be held in a variety of currencies including dollars, euros and sterling, and usually feature everything you would get from a standard current account, including online and mobile banking. It allows you to transact in multiple currencies and is particularly beneficial for those who need banking services overseas, as you avoid costly exchange rate charges.
Many people also open offshore bank accounts for favourable financial conditions, such as tax advantages or higher interest earnings. Holding your money under a well-reputed, tax-free jurisdiction allows you to deposit money without being subject to income tax or capital gains. It also helps to diversify your assets and minimise the risk of tax reforms or banking regulations, depending on your chosen bank.
Ultimately, the benefits of offshore banking will come down to individual circumstances. As such, it is important to do your research and seek professional advice.
At Turner Little, we take the time to sit down with you and listen to your bespoke needs. With over 20 years of international banking experience, we can offer you trusted information and advice you on how offshore banking could work for you. Get in touch with us today.